Oracle Database High Availability
Any organization evaluating a database solution for enterprise data must also evaluate the High Availability (HA) capabilities of the database. Data is one of the most critical business assets of an organization. If this data is not available and/or not protected, companies may stand to lose millions of dollars in business downtime as well as negative publicity. Building a highly available data infrastructure is critical to the success of all organizations in today's fast moving economy.

Well, the reason for above error is that i have taken the above script from a 11g database and running it on 10g database. 11g has bring some changes in password management. Below code is executed on 11g and user created successfully, which is expected result.